Car Dealers Fret Over Possible Tariffs, Survey Shows

First Up 09/11/18

Car Dealers Fret Over Possible Tariffs, Survey Shows
WardsAuto reports that surveyed U.S. auto dealers cite vehicle import tariffs and inventory availability as looming concerns in what they see as an otherwise bright market, according to the latest Cox Automotive Dealer Sentiment Index. Only 11 percent of all dealers (franchised and independent) believe tariffs on imported vehicles and parts would help their business, while 38 percent anticipate a negative impact. Fifty-one percent believe tariffs would have no effect. Franchised new-car dealers are more pessimistic, with 56 percent believing tariffs would hurt their business. Of franchised dealers who feel negatively toward tariffs, 66 percent believe consumers will face higher prices on all new vehicles, not just imports. The White House has threatened a 25 percent tariff on non-U.S.-made vehicles. However, some observers say that’s more of a negotiating tactic than an imminent reality. “While they are positive on today’s business, the new looming threat is the negative impact of proposed tariffs on imported autos and parts,” Cox Automotive Chief Economist Jonathan Smoke says of dealer sentiment. Read more here.

Volvo Idles S.C. Plant with Hurricane Florence Forcing Evacuations
Volvo Car Group will temporarily idle its brand new car factory in South Carolina after Hurricane Florence spurred orders to evacuate areas in the path of the Category 4 storm, reports Automotive News. “We have decided to shut down our plant tomorrow in light of the evacuation order that’s now in place for Charleston, Dorchester, and Berkeley counties,” Stephanie Mangini, a Volvo spokeswoman, said in an email. The factory is Chinese-owned Volvo’s first in the U.S. and recently began cranking out S60 mid-size sedans. Hurricane Florence’s top winds hit 130 miles per hour Monday to become a storm one step below the most severe level. The Carolinas are home to BMW AG’s biggest assembly plant in the world, as well as factories where Daimler AG units build Mercedes-Benz vans, Freightliner trucks, and Thomas Built buses. Representatives for the German manufacturers said they’re monitoring the situation. Read more here.  

U.S., Canada Will Meet Tuesday, Earlier Than Expected, on NAFTA
The Hill reports that the U.S. and Canada will resume high-level talks on Tuesday, which is earlier than expected, on the North American Free Trade Agreement (NAFTA). Canadian Foreign Minister and U.S. Trade Representative Robert Lighthizer will meet to try to hammer out the final complex details of a North American agreement with the aim of including all three countries in the 24-year-old deal, according to news reports. Discussions weren't expected to get going again until the end of the week. The U.S. and Canada met for most of last week without reaching a resolution. They are aiming to complete a deal by the end of the month so the three nations — Mexico, Canada and the United States — can sign an agreement by the end of November. Read more here. 

American Automakers Losing Ground in a Shrinking Chinese Market
American carmakers are losing ground in a shrinking Chinese market, and their problems are mostly tied to a lack of competitiveness rather than the trade war, an industry body said. According to Bloomberg, the market share of U.S. brands fell to 10.7 percent in the first eight months of 2018 from 12.2 percent a year earlier, according to the China Association of Automobile Manufacturers. The drop was caused by companies including Ford Motor Co. not refreshing their lineups in a timely manner, Xu Haidong, the association’s assistant secretary general, said Tuesday. While a slowing economy is weighing on the Chinese car demand, Xu said that the trade war has had a limited impact on the market. There are no anti-American sentiments or boycotting of U.S. brands by China’s car buyers, he said at a media conference in Beijing. Read more here. 

Vietnam's First Automaker is Quickly Getting Ready to Debut a Sedan and a SUV
It was once one of the most dangerous waterways in the world, heavily mined and bombed during the final stages of the Vietnam War, but today, Haiphong Harbor has become the heart of the country's economic boom, reports CNBC. And, if things go according to plan, it will soon become home to the world's newest automobile company, with nearly half of the 827-acre factory complex Haiphong-based VinFast is now building based on land reclaimed from the sea. Set to unveil two new models at the Paris Motor Show early next month, VinFast is the brainchild of Pham Nhat Vuong, a Vietnam native who, over the past quarter century, parlayed $40,000 in loans into an empire worth an estimated $10 billion. His Vingroup now operates a network of shopping malls, apartment complexes, spas, resorts, hospitals and schools across the country. VinFast marks its first entry into manufacturing. Its biggest test to date will come as the world gets its first glimpse of its products next month. Then, less than a year from now, Vietnamese consumers may get the chance to own one. Read more here. 

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